Beyond Meat stock is on a red-hot winning streak, just days after shares traded below $1 for the first time. Whether it can mirror the ascent of famed meme stocks like GameStop and AMC Entertainment remains to be seen.
It continued that rally on Tuesday, when Beyond Meat announced a deal with Walmart to expand distribution to more stores across the U.S.
At the close of trading Tuesday, Beyond was up 146% at $3.62, its best three-day stretch on record, according to Dow Jones Market Data. Shares traded as high as $3.86 during the session.
The stock had dropped below the $1 threshold before falling to an all-time low of 50 cents last Thursday. The losses occurred after the company disclosed the initial results of its debt-swap deal, which came with a considerable dilution of existing shareholders’ ownership. Beyond Meat is listed on the Nasdaq, and if it fails to meet the exchange’s basic requirements, including the minimum bid price of $1 for 30 consecutive days, it will be delisted.
But less than a week later, Beyond has come roaring back. While it’s trading nowhere near its all-time high levels above $200, the stock has tentatively escaped the danger zone for now. Shares ended Monday’s session up more than 127%.
The latest surge appeared to be result of a short squeeze, by which the price of a heavily shorted stock rises suddenly, forcing short sellers to buy back shares to cover their positions. This results in a further increase in the price. The same thing happened with beleaguered semiconductor stock Wolfspeed earlier this year.
Some retail investors spelled this out clearly on social media. One Reddit user declared in a post on Oct. 14 that it was time to “make $BYND great again” asserting the stock “deserves a squeeze.”
The chatter on social media indicates just where the bulls are coming from. A self-styled “Beyond Meat investor” going by the handle Capybara Stocks, who has since been banned from Reddit, posted to the platform last week detailing his position in Beyond.
Enthusiasm quickly mounted, to the point the campaign was acknowledged by Eric Jackson, a popular name in the meme stock world, best known for his bullish campaign on Opendoor Technologies.
“I’m getting flooded by people wanting me to take a position in BYND the last few days: is this some bot campaign?” Jackson posted to X on Oct. 18.
The same day, a flurry of posts cropped up on Reddit, with one user addressing the “retail army” and comparing the momentum to the rise of meme stocks GameStop and AMC in years past.
“This isn’t just a veggie burger anymore, it’s a symbol of rebellion,” the user asserted. “It’s a company that Wall Street gave up on and now it’s us, the people, who decide its value.”
Beyond may be in the spotlight for now, but this doesn’t improve the company’s shoddy fundamentals. The maker of plant-based meat alternatives continues to struggle with falling revenue and the same issues that have caused the stock to steadily decline since 2021.
So, renewed enthusiasm is lifting stock higher for now. But that doesn’t mean it will last, nor does it mean Beyond will become a success story.
AMC, for one, has taken steps to improve the health of its business, but recovery is a mixed picture, compounded by a sluggish recovery at the box office. In short, it’s a lot to chew on.